Group Writes Energy Sector Regulators Over STG’s Forced Liquidation

The group urged regulators in the oil and gas, and maritime sectors, “to take urgent actions in protecting the country’s business environment by wading into the unfolding crisis involving the forced liquidation of an indigenous company, Sea Trucks Group (STG), by a number of expatriates”.

by SaharaReporters, New YorkSep 20, 2018

Campaign Against Calumny, an interest group, has written letters to regulators in the energy sector, demanding urgent action to protect the country’s economy.

This was contained in a statement by Shina Loremikan, Coordinator of Campaign Against Impunity.

According to the statement, the organisation said it had observed happenings in the sector with interest and over the past months and urged regulators in the oil and gas, and maritime sectors, “to take urgent actions in protecting the country’s business environment by wading into the unfolding crisis involving the forced liquidation of an indigenous company, Sea Trucks Group (STG), by a number of expatriates”.

The group said it had written letters to critical actors and regulators in the sector, including the leadership of the Nigerian National Petroleum Corporation (NNPC), the National Petroleum Investment Management Services (NAPIMS), Nigerian Content and Development Monitoring Board (NCDMB), and the Nigerian Maritime Administration and Safety Agency (NIMASA).

It lamented the “little concerted efforts at intervening to safeguard” the company and urged the regulators to “presently discountenance the different claims of the liquidators and front company, Telford Offshore — for seeking an illegal possession of assets, and doing direct business in the country – till there is proper judicial resolution of this case”.

THE FULL STATEMENT

Having observed an apparent issue of impunity playing out in Nigeria’s oil and gas industry in the past several months, the Campaign Against Impunity has called on regulators in the oil and gas, and maritime sectors, to take urgent actions in protecting the country’s business environment by wading into the unfolding crisis involving the forced liquidation of an indigenous company, Sea Trucks Group (STG), by a number of expatriates.

This call was made in our recent letters to critical actors and regulators in the sector, including the leadership of the Nigerian National Petroleum Corporation (NNPC), the National Petroleum Investment Management Services (NAPIMS), Nigerian Content and Development Monitoring Board (NCDMB), and the Nigerian Maritime Administration and Safety Agency (NIMASA).

In the letters, we have urged these stakeholders to engage with the facts of the crisis involving STG and its liquidator, while acting in manners that uphold the rule of law and forestalls any arbitrary decision that could jeopardise the interests of STG, which appears the victim whose hands is being forced in this high-stakes tussle. This is, however, without prejudice to fairness to all parties involved in the dispute.

While many in the industry are aware of this case, there appear little concerted efforts at intervening to safeguard a Nigerian company from a battle of attrition that violates justice and fair play.

In a summary of the facts of the case deduced from our investigations, and which have been represented to the above listed sector regulators, there has been contention over a bond taken by STG on the advice of its expatriate staff, who were also said to be responsible for servicing the Bond, at the time it purportedly went into default. And the bond-holders were claimed to have subsequently called for the assets of STG, in lieu of their funds.

Yet, in a series of corporate intrigues, the earlier staff members of STG who were managing the bond on behalf of the company, turned around to become representatives of the bond-holders seeking to take STG into liquidation, in what appears a classic case of insider abuse, manipulation and conflict of interest.

Some of the nagging issues from the situation include the fact that while STG still appeared capable of meeting its bond obligations, despite having missed some of the payments, however those representing the bond-holders did not seem interested in rescheduling the payments but were rather in a hurry to liquidate the company and strip its assets – prominently in terms of taking over the JASCON vessels that STG was plying its trade with.

But, then how do you force a company that had not displayed signs of unrecoverable distress or shown itself as incapable of meeting its obligations into liquidation? Even then the liquidator had actually gone ahead to struggle for possession of and change the ownership of some of the JASCON vessels to that of a new company, Telford, despite subsisting court judgments urging the parties involved in the dispute to maintain status quo, with no asset stripping occurring, till there is a more substantive determination of the case.

These were the resolutions of the following court judgements:

In a suit filed by West African Ventures (WAV), a sister company to STG, against the liquidators on May 11, 2018, WAV applied for an order of interim injunction restraining the liquidators from taking any steps or undertaking any business in Nigeria. The case, with suit number FHC/L/CS/656/18, was presided over by M. B. Idris, a justice of the Federal High Court in Lagos. And after the consideration of the application, the court ordered an order of interim injunction restraining STG/Telford from taking any steps or undertaking any business in Nigeria.

Similarly, in another case, with suit number FHC/L/CS/1114/2017, filed on August 1, 2017, Hon. Justice (Prof.) Chuka Austine Obiozor ordered the parties to maintain status quo pending further order on the matter.

Yet, despite repeatedly reaching out to STG-In-Liquidation/Telford, they have deliberately refused to answer the very basic and pertinent question in this dispute: What is the value of the outstanding sum on the bonds, in relation to the overall value of Mr. Roomans’ companies and assets, for which they are now claiming ownership?

Also, from the facts of the issue, we have had to genuinely wonder that: Is the case of STG-In-Liquidation/Telford that of genuine liquidation or simply an attempt to take over a Nigerian company and its assets without recourse to a proper valuation of the assets involved, which should be balanced against the sum outstanding on the bond?

We would have thought that under the laws of natural justice, a proper liquidation process of a business concern could only be embarked upon when the debts/balance on the bond taken is greater than the assets of the defaulting company. Rather strangely, this does not appear to be the case at hand, as the assets far outstrip the balance on the bond taken.

More so, the new company, Telford Offshore, working in sync with liquidators of STG, and based out of Dubai, is seeking to carry on business in Nigeria, using the assets of Mr. Jacques Roomans – founder of STG and its sister company West African Ventures (WAV), despite the failure to address the issues raised on the liquidation protocol.

The Campaign Against Impunity has therefore made a strong call on the Nigerian federal government and the industry regulators – NAPIMS, NCDMB and NOTAP – for quick interventions into this matter as a way of protecting the sanctity of Nigerian businesses from the foregoing form of activities, in which court decisions and judgments are flagrantly flouted with impunity.

The regulators need to presently discountenance the different claims of the liquidators and front company, Telford Offshore – for seeking an illegal possession of assets, and doing direct business in the country – till there is proper judicial resolution of this case.

Otherwise, we foresee the negative consequences of the breeding of a climate of distrust in our justice system, and ultimately a lack of confidence in the Nigerian business environment, which would be most unfortunate in these days that the government is making spirited efforts at pulling all hands on deck in building the national economy.

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